The Justice Department on Tuesday asked a federal court to bar a pair of Hamburg tax preparers from submitting any more federal tax returns, charging that they inflated and made up deductions that cost the government more than $2.2 million in tax revenue.
The complaint against Brian Duffek, Patrick O'Connor and their firm, Duffek, O'Connor & Associates alleges that the tax preparers made up or inflated charitable contributions on their clients' tax returns.
The government also charged that Duffek and O'Connor made up or inflated unreimbursed employee business expenses for items such as work clothes, uniforms, professional subscriptions, business mileage, depreciation on computers, teaching and coaching supplies, student and athlete rewards and cell phone expenses.
The government also asked the court to order Duffek and O'Connor to turn over a list of everyone for whom they had prepared, or helped prepare, a federal tax return since the end of 2000.
"In general, in these cases, the names get turned over to the IRS and they do what is deemed appropriate," said Ben Porritt, a Justice Department spokesman.
Both Duffek and O'Connor said they were unaware of the federal complaint when contacted Tuesday afternoon by The Buffalo News.
O'Connor, when told of the allegations made by the Justice Department, denied any wrongdoing.
"This is the first call I've gotten on it," O'Connor said. "Wouldn't they have to inform us about it?"
Porritt said the complaint against the Hamburg tax preparers is part of a nationwide crackdown by the Justice Department on tax fraud. The government has sought injunctions against 131 tax preparers since 2001, with 103 of them being barred from preparing returns, he said.
"The investigations that we receive come from the IRS," Porritt said. "What happens when people aren't honest with their taxes is that it just shifts more of the burden to the Americans who are."
Duffek and O'Connor prepared 1,940 tax returns for the 2000-2002 tax years and an undetermined number of returns for the 2003 and 2004 tax years, the government said. The IRS alleged in court papers that the tax returns Duffek and O'Connor prepared for the 2000 to 2002 tax years understated the amount of federal income taxes owed by their clients by more than $2.26 million.
Kevin McKeon, an IRS spokesman, declined to comment on the case. "In general, we do remind taxpayers to take care in selecting a tax preparer," he said.
The government said some of Duffek and O'Connor's clients already have been audited and have been hit with interest and penalties on top of the additional taxes they owe beyond what they paid with their original returns. Others are expected to have to file amended returns or undergo audits.
"People who hire others to prepare their returns should review their returns carefully to make sure that they are true, correct and complete," said Eileen J. O'Connor, an assistant attorney general for the Justice Department's tax division.
Duffek, who lives in Orchard Park, worked as an income tax preparer from 1997 to at least 2004, the complaint said. O'Connor, who lives in Lake View, has been preparing taxes since 1999, initially at Duffek, Occhino & Associates before he and Duffek formed their own firm in January 2003.